One of Britain’s biggest payday loan firms targets cash-strapped families who become trapped in a devastating cycle of debt, a whistleblower reveals today.

High street chain Cheque Centre keeps desperate borrowers on its books by offering them new loans with sky-high interest rates even when they can’t afford to pay existing debts.

Staff are offered £50 bonuses and “jeans days” if they hit tough targets on collecting repayments and issuing new loans, and are threatened with a stern talking-to if they fail.

Now a former Cheque Centre worker has revealed the shocking tactics used by the firm to fill its coffers at the expense of those who turn to it for help.

In one email seen by the Sunday Mirror, area manager Phillip Conrath told staff to offer loans to ­customers who had defaulted on payments. He wrote: “I know that seems strange to many of you. But let’s think about it for a minute. The customer is already gone to debt (or will soon). If they pay us, that means we’ve got our money back and we’ve got the commission!

“If we loan again and they go to debt again... we aren’t any worse off than we were EXCEPT we’ve collected some commissions... So we’re actually better off!”

Every Cheque Centre store is encouraged to collect a minimum number of commissions to enable staff to receive a bonus.

Melanie Townsend, 25, who quit Cheque Centre in disgust earlier this month, said: “We were dumbfounded by the email. The general practice is, if they go into debt you would not reloan to them.

“It’s morally wrong because they obviously can’t pay. They don’t earn enough, or are on benefits, or handle their accounts badly. They’re in huge financial difficulty and the company is making it worse.

“Customers think the company is doing them a favour. It’s not. It’s disgraceful.”

In another email, the manager blasted staff for failing to hit targets on issuing new payday loans, and told them to “input” anyone who had been turned down for a loan. He wrote: “Yes it will be hard but ensure all rejected customers are inputted into the system.”

Melanie said: “That is bad. Those customers are rejected for a reason, because they can’t afford it. They don’t care, they just want the commissions.”

Last December the Sunday Mirror revealed how leafleting Cheque Centre staff preyed on benefit claimants, even stopping mums with prams in

the street. We also told how one branch pestered a dad-of-two for repayments as he lay in hospital after a suicide bid over his debts.

They then swiped money from his bank account three times in one day, including one transaction of only £5, to claw back a loan of less than £200.

In response to our stories, the US-owned company stopped its canvassing campaign, introduced a hotline for staff to report rogue colleagues and also vowed to wait at least a month before taking money from loan ­defaulters’ bank accounts or making chase-up calls. Earlier this month payday loan firms were ordered to clean up their act after a Whitehall summit investigated the controversial £2billion industry.

Cheque Centre has hundreds of stores and is legally obliged to advertise its APR of up to 3,873 per cent.

Its website states: “Payday loans are a short-term product... It can be an

expensive form of credit which is unsuitable for supporting sustained borrowing over longer periods”.

But Melanie said the approach is far from short-term, with the company offering to “buy back” customers’ debts in quick-fix deals that lock them into yet more debt.

For example, a customer with £40 outstanding on a £100 loan plus interest will be given a new loan of £100 less the £40 debt from the previous one. The ­customers get cash in their pocket but will be tied into a second loan – saddling them with yet more interest payments. Melanie of Portsmouth, who worked at four Cheque Centre stores in Hampshire over 18 months, said: “I’d try and get customers on a ­payment plan but the firm just wanted the debt cleared, and one way was to buy it back and reissue a loan.”

Tactics: Portsmouth Cheque Centre

She added: “Our Gosport store had 138 customers who were reissued with loans more than three times.

“They market them as short-term loans but they’re not dealt with that way. I know two customers who have maximum £1,000 loans a month with £250 interest each time – and they’ve been doing it for 18 months.”

Emails seen by the Sunday Mirror show the pressure put on staff to hit targets. One sent by Mr Conrath earlier this month read: “Guys we must have growth today. Any store that hasn’t ­delivered a PDA (pay day advance) today will be on a 5pm conference call.”

Melanie said: “There is pressure and the conference call is a punishment. That’s how they do it. We got paid bonuses and it used to be if we hit the PDA target I’d get £30. It’s changed now and only if you hit your PDA target, debt collection and commission you’d get £50 and the branch manager would get £100.”

In another email the boss wrote: “PDA growth guys, I need to see superstars in stores that can ­deliver. The top PDA and Buy Back store today can have a jeans day... Let’s attack this hard.”

Yesterday a Cheque Centre spokesman said: “We are investigating, as we do with every suggestion of irresponsible behaviour. However, branch staff do not make the decision on whether someone is given a loan. We use the same systems as the banks to credit score customers, to ensure they can afford their loan and that we are lending responsibly.